Zain soars on stake sale optimism
Kuwait, September 8, 2011
Kuwait's Zain climbed to a five-week high on Thursday on talk the telecom firm was closer to a $950 million sale of its stake in Zain Saudi , as regional bourses ended mixed amid uncertainty in global markets.
Zain climbed to at its highest value since Aug. 4 after market talk it was making progress in selling its 25 percent stake in its Saudi affiliate.
"Market rumours have started again that they (Zain) have made progress in selling their stake in Zain Saudi," said Shahid Hameed, Global Investment House regional asset management head.
"This is boosting their shares. The market is expecting them to make a good profit from this sale."
Zain ended up 4.2 per cent, trimming its year-to-date losses to 35 per cent. Kuwait's index rose 0.9 per cent.
Zain has agreed to sell its stake in Zain Saudi to joint bidders Kingdom Holding and Bahrain Telecommunications (Batelco).
However, Batelco's chief executive said on Thursday the $950 million deal was still weeks away.
The euro slipped against the dollar and stock markets rose ahead of a European Central Bank meeting that is likely to flag a halt to its monetary tightening cycle.
"For now, I expect regional fundamentals to take a back seat as the global concerns are crucial for the markets," said Rami Sidani, Schroders Middle East head of investment.
"There is an optimism prevailing globally in the financial market driven by a potentially accommodating financial policy."
Brent and US crude oil futures, down during trading hours on regional markets, later rose in choppy trade ahead of data expected to show US crude stockpiles fell last week.-Reuters